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India a priority market for Costa Coffee, to add around 50 stores every year: Global CEO Philippe Schaillee

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As part of expansion, Costa Coffee would not only be constrained to larger cities but also explore opportunities from segments as travel hubs like airports, train stations, office campuses etc, with specific propositions

New Delhi: India is among the “priority” markets for British coffee chain brand Costa Coffee, where it would continue to add around 50 speciality coffee stores every year, its Global CEO Philippe Schaillee said on Friday.

Costa Coffee, now owned by beverages major Coca-Cola, believes that India has enough headroom for growth led by factors such as a growing number of youths, who are shifting towards coffee from tea and a rise in disposable income.

As part of expansion, Costa Coffee would not only be constrained to larger cities but also explore opportunities from segments as travel hubs like airports, train stations, office campuses etc, with specific propositions, he said.

Besides, Costa Coffee, which opened its 150th store here, is also focused on increasing the like-to-like sales in every store.

When asked about Costa Coffee’s growth in the Indian market, Schaillee in a media roundtable here said:” When it comes to Costa, we are very happy with the growth rates in terms of store openings. We have a partner, which is committed to growth.”

“We are looking at 40-50 stores per year,” he said.

However, he also added: “If we see that there is a crisis for whatever reason, and we actually have to close a couple of stores, we will do it too. We have to be very agile.”

In India, Costa Coffee is operated through its franchise partner Devyani International Ltd (DIL), which has recently opened its 150th store here.

Interestingly, DIL is promoted by RJ Corp Ltd, which is also a promoter of Varun Beverages Ltd (VBL), which is the bottling partner of PepsiCo.

According to the latest annual report from DIL, it was operating 112 stores as of March 31, 2023, and closed the fiscal with revenue from operations at Rs 101.8 crore.

The average daily sales (ADS) for Costa coffee stores in India stood at Rs 35,000 per store for FY23.

As per its business expansion plans, DIL this week entered into a strategic agreement with leading multiplex operator PVR Inox to sell Costa Coffee’s handcrafted hot and cold coffee at select premium screens.

According to Schaillee, India is among the top 20 coffee markets. Like other tea-drinking countries, there is a shift happening towards coffee in India, which is led by the younger generation.

In major metropolitan cities in tea-drinking countries, consumption per capita is already at the same level as the averages of the US and Germany and it happened over the past 10 to 15 years, Schaillee added.

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